Last Week

All major regions finished the week with declines as rising U.S. bond yields continued to pressure equities. U.S. equities struggled the most, returning -4.2% followed closely by non-U.S. developed market equities (-4.0%). Emerging market equities performed best of the major regions but still dropped 2.2%

Federal Reserve Chair Jerome Powell’s hawkish comments in the first week of October led to higher rates that continued into last week with the 10-year Treasury touching a 7-year high of 3.26%

This Week

Investors will closely follow how tariffs, cost pressures across commodities, labor and logistics impact corporate margins as earnings season continues. The financials and health care sectors will be a focus this week with Johnson & Johnson (JNJ), UnitedHealth Group (UNH), Bank of America (BAC) and American Express (AXP) reporting earnings

Global inflation expected to remain relatively stable as inflation figures from Europe, Japan, and China will be posted throughout the week

September Fed meeting minutes will be released with special attention paid to whether four more rate hikes are expected through the end of 2019